[quote name='bvharris']You're crediting the average "investor" with far more savvy than they truly have. Most Madoff investors probably simply heard from friends that he was the best person to put their money with. If they'd been as knowledgeable as you claim, they probably wouldn't have been taken in from the start.[/QUOTE]
You know, I'd be more inclined to believe that if Bernie was willing to take Joe Intertube User's 5k initial investment or his 401k money. But he wasn't. We're talking about big money, at least a mil I think (or $5 mil?).
The case against the idiots:
1. Putting it all in one place.
2. Not questioning returns AT ALL.
3. The 100% unspoken belief on the street that Madoff killed by insider trading.
4. Not doing one ounce of due diligence (with Madoff's lolleraccountants in tow. I mean shit, really guys? Really?)
5. The truth as plain as the nose on your face (written in 2001):
More important, perhaps, most of those who are aware of Madoff’s status in the hedge fund world are
baffled by the way the firm has obtained such consistent, nonvolatile returns month after month and year
after year.
Madoff has reported positive returns for the last 11-plus years in assets managed on behalf of the
feeder fund known as Fairfield Sentry, which in providing capital for the program since 1989 has been
doing it longer than any of the other feeder funds. Those other funds have demonstrated equally positive
track records using the same strategy for much of that period.
Lack of volatility
Those who question the consistency of the returns, though not necessarily the ability to generate the gross
and net returns reported, include current and former traders, other money managers, consultants,
quantitative analysts and fund-of-funds executives, many of whom are familiar with the so-called split-
strike conversion strategy used to manage the assets.
These individuals, more than a dozen in all, offered their views, speculation and opinions on the
condition that they wouldn’t be identified. They noted that others who use or have used the strategy—
described as buying a basket of stocks closely correlated to an index, while concurrently selling out-of-
the-money call options on the index and buying out-of-the-money put options on the index—are known to
have had nowhere near the same degree of success.
He defies gravity! How? Can't be all those insider trading whispers, hmmmmm?
Right. Hold on while I bust out the violin.
[quote name='Chacrana']Actually knowing one of the guys who got
ed over by Madoff, I can confirm that this is untrue.[/QUOTE]
I have read that people were handing money over to asset managers who were pooling it and handing it over to Madoff and essentially taking a cut. Their lesson?
Trust the market. Of course they do due diligence. Why else do you pay them? lulz.
You've got a suit on! Well! Here's my life savings!
I don't mean to be a complete asshole. Obviously little guys got run over too and it ain't fair. Sorry. That sucks. Welcome to the market. I'd be the first to tell you the market is shit hole built to swindle. But deep down, we all (even the little guy) knows that. We just don't give a damn because we think we'll be the ones that get out while there's still chairs and music.
Nope.
If I was a little guy and my broker signed up with Madoff, I would have sued the shit out of him for not doing due diligence.
